AT&T Joins Verizon in Pushing Back on San Jose Agreements as ‘Model’

AT&T, Inc., today joined Verizon Communications, Inc., in pushing back on FCC Commissioner Jessica Rosenworcel’s suggestion that small cell agreements that AT&T, Verizon, and Mobilitie LLC reached with San Jose, Calif., to deploy small cell wireless infrastructure on about 4,000 city-owned light poles should be viewed as “model agreements,” even though AT&T and Verizon used the word “model” when they were announced earlier this month (TR Daily, June 15).

On Wednesday (TR Daily, June 28), Ms. Rosenworcel released the agreements and associated documents and said that “figuring out how to deploy 5G infrastructure — which puts a premium on small cells — is a big task. It means acknowledging that we have a legal tradition of local control in this country but also recognizing that more streamlined and uniform practices can help speed deployment. Our cities are important partners in this effort. That’s why today I am making available model agreements for small cell and 5G deployment negotiated by the City of San Jose and approved last night by the San Jose City Council. Through these agreements, carriers will benefit from streamlined access to thousands of city-owned poles for their small cell deployments. In turn, carriers will fund a decade long effort to help close the digital divide in San Jose, where more than 95,000 residents still lack access to broadband Internet service at home.”

In a tweet, San Jose Mayor Sam Liccardo said he also hopes the lease agreements “can serve as a model for other U.S. cities.”

In a blog posting yesterday, Verizon said that the agreements with San Jose should not be viewed as model agreements and that additional FCC action is still necessary to streamline the deployment of small cells (TR Daily, June 28).

“On Wednesday, June 27, 2018, Commissioner Rosenworcel announced the availability of several documents pertaining to small cell deployment in the City of San Jose, California, which she called ‘model agreements for small cell and 5G deployment.’ We agree that figuring out how to deploy 5G infrastructure is a big task and that cities are important partners in the endeavor, but AT&T respectfully disagrees that the arrangements in San Jose, including the agreements released Wednesday, represent ‘model agreements’ for other cities,” the carrier said. “The final agreements, which are not yet complete, are intricate, interdependent on each other, and unique to San Jose’s circumstances. They also demonstrate why Commission action is needed to prevent exorbitant fees and delays from impeding small cell deployment in cities and towns across America.

“San Jose, with over 1 million residents, is the largest city in Northern California and part of Silicon Valley, a global center for technology and innovation. Rapid small cell deployment by AT&T in that area is crucial to meeting the ever-growing data capacity demands of our customers,” AT&T added. “After two years of negotiations, AT&T reached an agreement with San Jose that would allow it to deploy about 2,000 small cells at rates and on timelines substantially better than previous city requirements, but still at rates and on terms that cannot be economically exported to other cities and towns throughout the country. For example, AT&T has proposed cost-based recurring fees to place small cells on city structures at less than $50. The rate structure in the San Jose agreement runs up to $2,500 per site. If conservative industry projections accurately estimate small cell deployments at 800,000 by 2026, San Jose’s rate structure when applied to cities nationwide would cost approximately $2 billion incrementally, leading by necessity to less expansive small cell deployment in communities across the nation.

“The agreement with San Jose was nonetheless reached because it was necessary given the network usage in the area and the population density that is served there. But, as Commissioner [Brendan] Carr has noted, it is important that every community get ‘a fair shot at 5G.’ Giving mid-sized and small communities that shot will occur only if cities charge rates for access to rights of way and rights of way infrastructure that are cost-based and closely related to their management, if local approval processes are reasonable, timely, and nondiscriminatory, and if other non-price-based restrictions do not otherwise effectively prohibit the provision of service,” AT&T argued. “In that regard, the Commission’s ongoing review of these issues is essential.”

AT&T continued, “In short, we believe that the Commission’s work on a model code is essential. Such a model will be built on thoughtful input from all stakeholders through a notice and comment period and take into consideration the extensive work being undertaken by the Commission’s Broadband Deployment Advisory Committee, including contributions from industry, government, local communities and others who have a stake in our collective 5G future[.]”

Mobilitie had no comment today on Ms. Rosenworcel’s comment.

Ms. Rosenworcel’s office had no immediate comment today on the reaction by Verizon and AT&T to the “model agreements” characterization of the San Jose contracts.

When the agreement with San Jose was announced earlier this month, Lauren Love-Wright, Verizon’s vice president-network engineering, said, “San Jose can be a model for other municipalities in both their support of innovation and investments in digital inclusion,” while AT&T said, “This type of public-private partnership is an example of a long-term, model lease agreement that will deliver digital advancements for the City and its citizens.”- Paul Kirby, [email protected]

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